When most people think of NFTs, they think of art. Selling digital art and providing the buyer with actual ownership of the asset was the early, original utility for NFTs. Later this branched into music, with bands deciding to release their albums as NFTs in NFT drops. As NFTs have exploded in popularity recently, the focus of the growing NFT space has entered new industries and provided new types of utility for NFTs.
The rise of INOs (like ICOs but for NFTs) has taken the NFT space a step further as it has offered an easy way for NFT fans to shop for their favorite NFTs and invest in the most intriguing NFT projects. Here are some of the use cases for NFTs out of the rapidly growing list of NFT utility types.
NFT Utility #1: Staking
It is possible to stake NFTs, introducing the concept of yield-earning NFTs. Multiple projects enable NFT owners to stake their NFTs. Look for this to become a broader market in the future as more people become aware of the wealth of opportunities available in the NFT market.
NFT Utility #2: Fashion
NFTs are taking over the fashion industry! Digital wearables are becoming popular, especially with the continued development of Metaverses, where users will be able to wear the digital wearables they have purchased as NFTs. Decentraland held the first Metaverse Virtual Fashion Week between March 24th and March 27th, 2022.
The fashion week didn’t only feature fashion designs from NFT and crypto projects, but many of high fashion’s top brands were also present. Gucci, Dolce & Gabbana, Tommy Hilfiger, Estée Lauder, and Elie Saab were all present at Metaverse Virtual Fashion Week.
Fashion NFTs have gone mainstream. We expect even more of the world’s top brands to begin to develop digital wearables with the continued growth of the NFT space. In a short amount of time, fashion has become a major NFT utility, with NFTs impacting fashions from across the globe.
NFT Utility #3: Ticketing
NFTs can also serve as event passes, serving as digital tickets. Since NFTs imply that the buyer owns that digital item and blockchain technology allows for tracking ownership, NFTs represent the next generation of event tickets. The most obvious use case might be for entrance to digital events in the Metaverse, but NFTs represent a potential upgrade to ticketing for real-world concerts and events.
NFT Utility #4: Citizenship
A small group of crypto enthusiasts set up an island in Vanuatu where no fiat currencies will be allowed. The island, called “Satoshi Island” and named after the creator of Bitcoin, already includes homes under construction and is offering space to crypto companies.
They are offering citizenship NFTs to other crypto aficionados, and so far, they have already received more than 50,000 citizenship applications. The island will be a “true crypto economy with everything paid in crypto, and all ownership on the island represented with NFTs.”
In an interview with Cointelegraph, the team behind Satoshi Island added that “the island intends to host events year-round, house and headquarter crypto projects, and be a gathering place for crypto enthusiasts worldwide.”
With more than 50,000 people looking to become crypto residents of the island or granted citizenship, who knows, it could become a crypto paradise. Citizenship is undoubtedly one of the most exciting types of NFT utility devised so far.
NFT Utility #5: Gaming
NFTs are being used extensively for gaming. Play-to-earn games like Axie Infinity have become sought-after alternatives to pre-existing games because they allow players to earn money in crypto as they play. NFT gaming marketplaces also exist, and these marketplaces and games provide access to NFTs that give NFT holders access to special characters, game levels, etc.
NFT Utility #6: Fundraising
NFTs can be used for fundraising as well. For example, instead of offering a free t-shirt or entry into a drawing for raising a certain amount of money for a charitable cause, charities and non-profits can offer an NFT as a prize for raising a certain amount of money. This would likely be a more appealing prize and could motivate people to raise capital more because t-shirts lose value once they are worn, but ownership of an NFT is like an investment, and its value can grow over time.
NFT Utility #7: Music
Briefly discussed earlier, NFTs are now a part of the music industry, and more bands are starting to offer albums as NFTs. Music NFTs certify on-chain ownership of a token connected to a music file, although they generally don’t grant royalty rights. However, Royal is helping artists mint NFTs that can generate royalties, and it also allows NFT enthusiasts to invest in artists directly. This could be game-changing for the music industry.
These seven different types of NFT utility are far from the only ones, and more types of utility will apply to NFTs. There are many more ways to use NFTs. At Swappable, we believe that we are just starting to see the different applications of NFTs and blockchain, and some of the most compelling use cases of NFTs have yet to develop.
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